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A Seat At The Table: Restaurants and The Employee Retention Credit

The pandemic has had far-reaching impacts on the restaurant industry, leaving many establishments closed and employees without jobs. According to The Washington Post, more than 78,000 restaurants have closed their doors due to COVID-19-related disruptions.

This is a clear sign of the pandemic’s devastating effect. Hundreds of thousands of jobs have been lost, impacting countless families and communities.

The Impact of COVID-19 on Restaurants...

During the pandemic, many restaurant owners were forced to make difficult decisions to remain afloat. Some implemented layoffs while others reduced employees' hours but many found themselves in situations where other costs increased.

In response to the pandemic, restaurants have had to make significant changes and adaptations to protect their customers and staff while also ensuring that they could continue to provide quality service. Many restaurants implemented new safety protocols such as physical distancing, barriers for indoor dining, carryout only, canceled catering, contactless payment methods, and more frequent sanitation of high-traffic areas. Many of these changes required added expenses for restaurant owners.

The financial strain caused by the pandemic has been particularly difficult for many restaurant owners. With decreased sales and limited capacity due to physical distancing protocols, many restaurants struggled to remain profitable and keep their employees employed.

Restaurants and The ERC...

The Employee Retention Credit (ERC) has helped many restaurant owners offset the impact COVID-19 caused on their businesses. This tax credit provides eligible employers with a refundable payroll credit for a portion of the wages paid to employees during the pandemic. Essentially, this gives cash back to the business for keeping people on the payroll during hard times.

Furthermore, the ERC has been beneficial for the employees themselves. Many restaurants that have taken advantage of the ERC have reported that it has helped them bounce back and put money back into their business. There are numerous success stories of restaurants that have been able to remain open due to the ERC.

Overall, the ERC has been a lifeline for many restaurants throughout the United States, allowing them to keep their businesses afloat and their employees employed.

Restaurant ERC Success Stories...



Received PPP

Total Credits Claimed

Donut Shop and Cafe in Ohio


Yes- 1 Round


Restaurant and Bakery in California


Yes- Round 1&2


Restaurant Group in North Texas


No- Client was ineligible


Does A PPP Loan Disqualify You For The ERC?

Under the recently expanded American Rescue Plan, restaurants that took PPP loans may now qualify for the ERC.

If My Restaurant Received a Restaurant Revitalization Grant, Can I Claim The ERC?

Yes, many food and beverage businesses that received a Restaurant Revitalization Grant can still qualify for and receive the #EmployeeRetentionCredit.

How Can My Restaurant Claim The ERC?

Every restaurant is different, but we hear stories from food and beverage business owners, describing impacts from mandates and/or reductions in gross receipts that qualify them to capture the ERC. From these experiences, we know that there are many unclaimed dollars out there for businesses to capture. With our expertise and tailored process, we determine whether you’re eligible, calculate the tax credits available to you, file the claim, and defend you under audit if the IRS ever questions your ERC claim. Find out more about the ERC and whether it might be right for you here, or call us at 833-3INCENT.


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